Ally Financial is marketing $664.45 million in notes secured by the receivables on lines of credit it provides to dealers primarily franchised with General Motors and Chrysler USA.
Ally Master Owner Trust (AMOT) Series 2017-1, the second dealer floorplan securitization in the market in 2017, includes a $500 million senior Class A floating-rate notes series tranche with expected ‘AAA’ ratings from Fitch Ratings and Standard & Poor’s. General Motors completed a deal in January.
It's also Ally's first securitization of inventory financing since May 2015.
Neither S&P nor Fitch is rating the subordinate B,C,D and E tranches of notes making up the balance of the transaction.
Initial credit enhancement on the Class A notes is 25.25%, down from 26.5% from eight previous issues. Result of a decline in the reserve fund to 0.5% from 1%, and reduced subordination to 24.75% from 25.5%.
The Ally trust has an existing principal outstanding balance of $15.5 billion and $13.5 billion of eligible principal receivables, and has 1,853 dealer accounts with an average principal balance of eligible receives of $7.3 million.
That is higher than that with dealers served by the Ford Motor Credit ($5.95 million) and GM Financial ($6.44 million). More than 13% of the receivables were originated with Texas dealers.
GM Financial was the first captive finance company to issue a dealer floorplan securitization in 2017 last month.
Receivables from GM and Fiat/Chrysler dealers make up over 90% of the total collateral; up to 4% of the pool is available for AutoNation dealers.
Fitch reports that 89.3% of the receivables are credit lines for new vehicle inventory, and only 4.1% are aged over 270 days – both levels consistent with historic levels.
The diverse pool has only a 16.4% concentration among the top 20 dealers.
According to S&P, there have been no material changes to the collateral performance since 2014-5 with steady monthly payment rates that have averaged 34.18% by dealers. Losses have been 0%.
JPMorgan is the lead underwriter. The deal is expected to close Feb. 22.